Under what circumstances would a Remax franchisee be required to reimburse Remax, LLC for legal costs and expenses?
Remax Franchise · 2025 FDDAnswer from 2025 FDD Document
mited to your de-identification obligations pursuant to Subsection 14.B; (ii) any Claim that REMAX Regional, REMAX, LLC or any of the Related Parties are a joint employer with you for any reason; and (iii) allegations that REMAX Regional, REMAX, LLC or its Related Parties were negligent or failed to train or supervise you, your Owners, or your Sales Associates, even if any Claims are brought or filed after transfer, termination or expiration of this Agreement or Abandonment of the Office. You agree to indemnify, defend and hold us and REMAX, LLC, and each of our and their Related Parties and our and their respective officers, directors, employees and shareholders harmless from and against, and to reimburse us and them for, all such fines, taxes, costs, expenses, damages, loss or liability for which we or they are held liable or which we or they incur in connection with any Claims, including, without limitation, actual and consequential damages, attorneys', accountants', and expert witness fees, cost of investigation and proof of facts, court costs, other litigation expenses and travel and living expenses. You agree to waive all rights of subrogation against REMAX Regional, REMAX, LLC, each of our and their Related Parties, and our and their respective officers, directors, employees and shareholders. REMAX Regional and REMAX, LLC have the right to defend any Claims and, in connection therewith, to retain legal counsel of our or their choice and bill you for all costs and attorneys' fees incurred for any Claim originating from the acts/omissions of you, your Owners, employees, or Sales Associates, which costs and fees you
must promptly pay.
Source: Item 22 — Contracts (FDD pages 108–334)
What This Means (2025 FDD)
According to Remax's 2025 Franchise Disclosure Document, a franchisee may be required to reimburse Remax, LLC for legal costs and expenses under two primary circumstances. First, the franchisee is solely responsible for costs arising from any claims related to the operation of the franchise, including acts or omissions of the franchisee, their owners, employees, or sales associates. This includes failure to comply with laws, claims that Remax is a joint employer, or allegations of negligence. The franchisee must indemnify Remax, LLC and related parties, covering all fines, taxes, costs, and expenses, including attorney's fees and litigation expenses.
Second, if Remax engages legal counsel due to a franchisee's or their owners' failure to comply with the Franchise Agreement, the franchisee must reimburse Remax, LLC for all associated costs and expenses. This includes reasonable fees for accountants, attorneys, expert witnesses, investigation costs, court costs, litigation expenses, travel, and collection costs, even if these are incurred before any legal proceedings are filed. This obligation extends to costs related to counterclaims brought by Remax in legal proceedings initiated by the franchisee or their owners.
These provisions ensure that Remax, LLC is protected from financial losses resulting from a franchisee's actions or non-compliance. The franchisee bears the responsibility for legal and related costs arising from their business operations and any breaches of the franchise agreement. This requirement survives the termination or expiration of the agreement, or abandonment of the office, highlighting the long-term financial responsibility of the franchisee.